South Korea to explore vast oil, gas prospects off east coast, but is it too early to celebrate?

South Korean President Yoon Suk-yeol announced on Monday the discovery of potentially vast oil and gas reserves off the country’s southeastern coast, sending energy share prices through the roof.

Analysts said, however, that it was too soon to say whether the find would necessarily lead to a viable source of domestic energy production and suggested the premature announcement could have been a strategic move meant to boost the embattled president’s flagging political fortunes.

“Recently, it was found that there is a very high possibility that up to 14 billion barrels of oil and gas exist in the seabed, which has been verified by leading research institutes and experts,” Yoon said during a rare news conference on Monday.

Yoon said the potentially massive reserves could meet South Korea’s gas demands for 29 years and oil demands for four years.

The president said he gave the green light to conduct exploration drilling to confirm the energy reserve off Yeongil Bay near the city of Pohang, about 260km southeast of Seoul.

Gas was found in the late 1990s in the same subsea field, the only one South Korea has ever exploited for production. It produced 45 million barrels of gas before its closure in 2021.

The new prospect is more than 300 times the size of that field, Yoon added.

The president said the government planned to bore at least five wells into the seabed to reach suspected hydrocarbon zones, each of which would cost more than 100 billion won (US$72.6 million).

“The world’s top energy development companies have already shown interest,” he said. “After preliminary preparatory work, the first borehole will be drilled at the end of this year and we should have some results by the first half of next year.

“I hope the public will